Italian contractor wins compensations for terminated highway contract in RO

The International Arbitrage Court in Paris (ICC) awarded EUR 50 million compensations to Italian company Salini Impregilo for a highway construction contract illegally terminated by the Romanian state.

The Court also ruled that the contract for the construction of the Lugoj-Deva motorway, canceled in 2017, remains in force.

Transport minister Lucian Bode says that the Government would challenge the decision. He blamed the public road company CNAIR for refusing to show up and defend Romania’s interest in Court during the lawsuit in Paris.

Signed in 2013 by CNAIR and Salini, the contract was initially estimated at EUR 350 mln, mostly coming from EU funds. A decision issued by the environment authorities after the signing of the agreement implied additional works that significantly increased the construction costs because of tunnels for protecting the natural habitat of brown bears.

In 2017, Romania’s public road company CNAIR invoked the rise in the value of the works and partly terminated the contract with Salini. It excluded from the contract the 9-km segment, for which the costs had risen significantly. In 2019, CNAIR launched a public tender for the 9-km segment.

Failure to complete the entire Lugoj-Deva motorway by 2023 will result in Romania losing the financing from the European Union for the project, according to Hotnews.ro.

The Lugoj-Deva is a segment of the Sibiu-Nadlac motorway, which should be later connected to the Bucharest-Pitesti highway.

(Photo: Pexels.com)